Rain and sluggish consumption dampen mood at breweries
Increased production costs and a slump in consumer spending are weighing on Lower Saxony's larger breweries. Two major breweries from the north, Friesisches Brauhaus zu Jever and Einbecker, were asked to take stock of the past few months. A largely rainy summer also dampened the mood. "The best beer seller is and remains good weather, and that literally fell through this summer," said Michael Reitze, spokesman for the management of Friesisches Brauhaus zu Jever. For long stretches, the summer was too cool and too rainy for the taste of the brewers.
"The market trend has certainly left its mark on us," said Reitze, whose brewery is part of the Radeberger Group. Nevertheless, sales had developed "above the industry level" and sales of draught beer had stabilized after the restart of catering and events. However, the brewery does not provide exact volumes or figures on sales and turnover.
The Einbecker Brauhaus has a similar picture. "We are currently operating at industry level. The beer garden season was slightly down on the previous year," said brewery spokesman Ulrich Meiser. Nevertheless, the company is not dissatisfied with the sales and even more so with the revenue development. However, the independent public limited company from southern Lower Saxony is not yet able to provide real balance sheet figures.
Consumers save money when buying drinks
Brewers in the state therefore have mixed feelings about the past few months. On the one hand, restrictions due to the coronavirus pandemic were lifted in the hospitality industry and many festivals, open-air events and music festivals took place again. In addition, there was a long early summer, which brought weeks of weather suitable for beer gardens.
On the other hand, the consumer slump and price increases have recently continued to affect brewers. "Consumers are saving money when buying food and drinks, for example by increasingly switching to discounters, choosing retailers' own brands or simply reducing their overall spending," said Michael Reitze from Friesisches Brauhaus. Even going out is still a long way from returning to pre-corona levels.
"The mix of weather and consumer restraint due to inflation is having an effect," summarized Einbecker spokesperson Meiser. According to him, the problems facing the catering industry, such as staff shortages and the threat of a VAT increase, are well known. "Draft beer sales are therefore still some way off the pre-corona level," said Meiser.
Breweries burdened by operating costs
Breweries in the country are also burdened by operating conditions. Price spikes have eased recently, according to Friesisches Brauhaus, for example. However, the costs for the production, transportation, distribution and marketing of beer have become massively more expensive. A further increase in prices is even to be expected. The brewery cites wage settlements and a foreseeable increase in truck tolls as reasons for this.
The high costs of raw materials and energy, for example, are placing an undue burden on breweries, Einbecker also said. And there are still uncertain supply chains, but these are gradually working better again. The brewery is currently reducing its energy costs by around 20 percent through its own efforts.
Trend towards declining beer sales
In the first half of the year, breweries across Germany again sold less beer than before. According to the Federal Statistical Office, 4.2 billion liters were sold - that was 2.9 percent or 128 million liters less than in the same period last year. A downward trend thus continued.
Friesisches Brauhaus zu Jever assumes that the decline in beer sales in Germany will continue in the medium and long term. And Einbecker Brauhaus is also assuming that this year will not see a recovery, but that the downward trend will continue. "We are cautiously optimistic for next year," said Meiser.
The challenging operating costs and the trend of consumers saving money on food and drinks, including switching to discounts and reducing overall spending, have impacted The company's sales. Despite the mixed feelings about the past few months due to the reopening of the hospitality industry and favorable weather, both Friesisches Brauhaus zu Jever and Einbecker Brauhaus are operating at or slightly below the industry level, with sales stabilizing for Friesisches Brauhaus and Einbecker still anticipating challenging revenue figures. In light of these challenges, both companies are producing and selling less beer, following a declining trend in the industry.
Source: www.dpa.com
